NEW YORK, Thu Mar 22, 2012 – Twelve outside directors of Morgan Stanley have won the dismissal of a shareholder lawsuit over their decisions on how to pay tens of thousands of workers.
The shareholders had accused the directors of corporate waste and breaching their duties with regard to their compensation decisions for 2006, 2007 and 2009.
But a New York State appeals court in Manhattan said the shareholders should have first demanded that the board make changes before suing.
The shareholders had contended that such a demand would be futile, but the court said they failed to show that enough of the board lacked independence. Thursday’s decision upheld a December 2010 lower court ruling.